Up to 80% discount across products and leading brands! Flipkart, Amazon begin sale war

Both Flipkart and Amazon have asked sellers and brands to offer heavy discounts, which they will partially compensate by charging a lower margin from them.Writankar Mukherjee | ET Bureau | May 05, 2017, 08:05 IST

KOLKATA: Flipkart and Amazon are at it again, much to the delight of shoppers! The country’s two biggest online marketplaces have lined up near-simultaneous sales this month that will offer consumers another discount bonanza well ahead of the festive season, when such mega-events typically take place.

For sellers on these online platforms, this is an opportunity to make up for business lost following the cash crunch caused by demonetisation. Flipkart's sale from May 14 to May 18 will be called the ‘Big 10’ sale to mark its 10th anniversary. Discounts of up to 80% will be offered across products and leading brands. India’s largest online marketplace informed sellers that it expects a three-to-four-fold rise in revenue during the sale.

Not to be outdone, rival Amazon announced the return of its ‘Great India Sale’ from May 11 to May 14, which will “witness thousands of blockbuster deals at never-seen-before prices”.

Both Flipkart and Amazon have asked sellers and brands to offer heavy discounts, which they will partially compensate by charging a lower margin from them, three top sellers said. Additional discounts will be provided through cash-backs for digital payments.

Myntra, the fashion e-tailer owned by Flipkart, will run its own mega-discount sale at the same time as its parent, they said.

“Flipkart has indicated that discounts will be massive for its 10th anniversary sale,” said a top online seller.

“Maximum focus on will be smartphones, televisions, consumer electronics, fashion and accessories,” the seller said. “Amazon’s discounting will be widespread across categories.

However, it too will have a larger share of deals in the categories that Flipkart will focus on to wrench some market share.”

Dhruv Goyal, cofounder of online craft company ExclusiveLane, which sells products on Flipkart, said the sale will be massive. “Since Indian consumers are discount lovers, they are obviously going to love the discounts, if they are genuine,” he said.

A Flipkart spokesperson said this is the first time it is organising a fiveday sale outside ‘The Big Billion Days’ sale, which was held from October 2 to 6 last year. He said in addition to the discounts, the marketplace will offer 10 big benefits to all customers.

Amazon’s customers shopping during the upcoming sale can look forward to big savings on brands such as Samsung, Motorola, OnePlus, Sony, LG, Whirlpool, Puma, Titan, Wrangler, Biba and Fastrack, it said in a release on Thursday. Consumers opting for non-cash payment modes can get cash-backs, it said.

The chief of a leading smartphone brand said both Amazon and Flipkart are building up their inventory for the sale and vendors have stocked four times what they normally do. “The marketplaces and brands expect this sale will compensate for quite a bit of the loss of business during the demonetisation period,” he said, requesting anonymity.

However, some vendors are concerned that the sales will benefit mainly the private labels and sister concerns of the marketplaces and their preferred sellers.

A spokesperson for the All India Online Vendors’ Association, a group of more than 2,000 sellers, said the maximum discount will be offered by the sister concerns and preferred sellers of the marketplaces and their private labels.

“In fact, the sellers’ sales and margins are reducing due to predatory pricing by the sister companies and private labels of marketplaces. The government is sleeping over this matter despite our constant efforts,” he said.

Online marketplaces such as Flipkart and Amazon cannot sell products directly to customers and are not allowed to offer discounts or influence prices. No seller on a platform can account for more than 25% of sales.

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